Accounts are complicated at the best of times. What should at one level be simple addition and subtraction turns into an intricate tangle of complex maths that, in the right hands, can say just about anything about your company’s finances. At another level, the job of collecting money from clients and paying suppliers should be easy. But it’s not. In fact, errors creep in every day. The average invoice has around twelve fields, and if one of these is wrong it can result in a missed or unnecessary payment. An accounts payable audit helps you find out what is going wrong – who owes you money, whether fraud is occurring at any level, whether duplicate payments and other kinds of overpayment are happening, and so on. The incidence of errors is something like 0.1 percent. This means that one in a thousand payments is going to be wrong in one way or another. Recovery audit software finds those wrong payments and reverses them.
These accounting problems are at their worst when you’re dealing with high volumes of transactions but a low turnover. If you are working hard to make ends meet – making a large number of sales but just about breaking even, for example – then overpayments will have a disproportionate effect on your bottom line. They could even make the difference between staying afloat and sinking.
Then there’s fraud. Many businesses’ accounting systems aren’t set up to see this when it occurs. But what happens if someone intentionally submits an additional invoice – perhaps identical to one they have already sent? Without the right checking procedures it could easily result in a duplicate payment. It happens all the time, but all too often it also goes totally unnoticed.
Recovery Audit and Duplicate Payments software can prevent the haemorrhaging of profits that can result from accounting errors. It can pay for itself the very first time you use it, clawing back the cash you’ve unnecessarily paid to suppliers and collecting it from those who are late paying. Since you might have several years of accounts to correct, this can result in a tidy lump sum. In any case, an accounts payable audit is well worthwhile, since it can discover where you are making duplicate payments and allow you to protect against fraud and other errors in the future. When so many businesses are struggling to get by, every little extra bit of help is welcome.
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